November 20, 2016

Politics

Politics can be an extension of who we are. If politics are nasty and "the country is divided", maybe it is because some people feel nasty and divided.There are so many parallels between politics and marketing.Sanders & Trump

+/- 45% of primary voters supported Sanders & Trump. Each represent "new merchandise". Sometimes our customers get tired of the same "winners" (i.e. Bush family or Clinton family) and demand something new. The same thing happens in your business. Make sure you have a steady pipeline of new merchandise.

Dependence Upon 3rd Parties

Trump controlled his message via Twitter. You may like or dislike what he said, but he was the one saying it. Clinton depended upon advertising. Advertising enriches those who control advertising. In Marketing, you can have a strong point of view, or you can depend upon 3rd parties (Google, Facebook, Retargeters). Have a strong point of view. Discounts and Promotions are taxes placed upon brands for being unremarkable.

Fake News, Fake Metrics

This past week we heard a lot about fake political news being more "engaging" than real political news. Well isn't that special? And then we learned that Facebook overstated organic reach ... a company that knows AI and algorithms and is worth $341,000,000,000 makes money by selling ads against fake news and then uses fake metrics to demonstrate effectiveness.

Fake news and fake metrics dominates modern marketing. Dominates it. "Five Tips For Perfect Pay-Per-Click Copy, Number Three Is A Real Stunner". "How To Harness The Power Of Bots". That's fake marketing news. It's everywhere. In fact, it is almost all that you read. But the content is #engaging, and that's what we are supposed to optimize for. Speaking of fake metrics, #engagement is surely at the top of the list. A few months ago, I asked Twitter followers if they'd prefer a customer spending $100 today or a customer who engages with our content and spends $0. 52% chose the latter. Kinda tells you everything you need to know about fake news and fake metrics.

Rural & Industrial Counties

Much was made of voters in rural counties & industrial counties voting for Trump.

Catalogers - analyze zip code sales per population sometime, especially among phone buyers. You will see the same dynamics that we saw in the election with Trump voters. Catalogs matter in rural counties where one is lucky to have 12mbps DSL internet access (I have 3mbps at my home ... let that one sink in for a moment ... it takes as long to load an episode of Stranger Things as it takes to watch the episode). But if you live in an urban environment in Seattle or San Francisco or NYC or Atlanta, catalogs are unfathomable in the same way that to some of those residents it is unfathomable that somebody would vote for the opposition candidate.

Willing To Overlook Flaws

Each Presidential candidate had serious flaws. Fans of either candidate were completely willing to overlook the flaws of their candidate in an effort to demonize the flaws in the other candidate.

Marketing is the same way. Want to have some fun? Point out the flaws in the discipline a marketer loves to practice. It won't be pretty. We all overlook the weaknesses in our chosen discipline but are more critical of the flaws of another discipline.

Pick A Side

"We're a divided country", or so the media tells us. Team Red or Team Blue. When the wall came down in 1989, we stopped fighting Communism and started fighting ourselves. Thanks cable news for that lovely gift!!

In marketing, we've picked sides. Marketers tend to spend more time with vendors than with co-workers ... "we speak the same language" is what one marketing employee told me. Alright.

Pricing - we're in the process of picking sides. No more middle ground. We either sell expensive stuff at hefty gross margins or cheap stuff at 30% off with free shipping and virtually no gross margin. The two approaches require completely different marketing strategies, and require completely different profit generation strategies. But make no mistake, we have to pick one or the other ... the middle ground is disappearing. And the choice of pricing strategy actually means we are picking a customer ... poor customers or rich customers. There aren't enough middle-income customers left to fuel a business plan from 1995. So pick a side.

Just Plain Wrong

Clinton was going to win. Just ask the analytics folks, the pollsters. A group at Princeton University had her with a 99% chance of winning. How arrogant is that? Almost every poll gave Clinton a multi-point advantage.

The metrics and the experts who interpreted the metrics were just plain wrong. But they still hold the megaphone, and they are still telling us why they are right.

Can I tell you a story? Last May, my wife and I drove across Montana on US-2. These are "red counties" that you drive through. Poor. Abandoned buildings, abandoned industry. There were two industries that survived & thrived ... drive-in diners and health care ... sprawling new clinics and hospitals everywhere you looked. All you had to do was drive 650 miles on US-2 across Montana to realize that the election was much closer to 50/50 than 99/1. Many Trump signs on lawns. Few Clinton signs on lawns. But you can't observe the dynamic by sitting in front of a computer crunching poll results. You have to get out there and see it for yourself.

Similarly, the experts in our world are just plain wrong. They sit in front of a keyboard and tell us that we have to be "omnichannel or die". You are supposed to spend tens of millions of dollars revamping your supply chain and operational distribution system so that a customer can order a widget online and then for some bizarre reason drive 20 minutes to a store to pick it up and then the item isn't available at that store so the systems find the item at another store so the customer visits that store and then mysteriously asks to have the widget shipped to her home from the store #omnichannel. And Macy's goes and does everything that the pundits tell Macy's to do and the advice is absolutely horrific and Macy's collapses and the experts blame Macy's ... it's their fault! The experts were just plain wrong on Omnichannel Strategy. The experts are just plain wrong about Social Media saving your business. The experts are just plain wrong about saving your business by #Digitizing your business. The experts need to spend time visiting actual stores to see how feckless their strategies are in the face of actual retail issues. Instead of analyzing digital data in front of a keyboard, experts need to spend considerable time in stores ... not unlike the time a pollster should have spent driving US-2 across Montana to truly understand the challenges voters face.

The Wrong Issues

The media covers stuff that is largely irrelevant ... "Can You Believe What Trump Said/Did?" ... "Can You Believe Clinton's Email Server Challenges?" How does either issue help the person living along US-2 in Montana or help the person who cannot afford to rent an apartment in San Francisco?

Nightly news programs on major TV networks spent a total of 32 minutes talking about actual policies during this Election cycle. 32 minutes. Total!

Such is the case with modern marketing. No, you will not save your business by having a "Holiday 2016 Bot Strategy" or by "Using Neuroscience To Make Sure The Color Orange Is Used In The Conversion Funnel". These are the wrong issues, and you are overexposed to them because vendors and trade journalists and research brands sell soap when they talk about them.

I'm not taking one political side or the other.

I am asking you to open your eyes.

Pay attention to what is going on around you.

Get away from the keyboard, and spend real time interacting with real people - preferably your real customers or #gasp hourly employees in your call center or distribution center or retail store.

Be a Leader.

Have empathy for employees and customers who have different views than you have.

And in 2017 we're going to have to pick a side. That's where the world is headed. We're going to have to pick affluent customers or everybody else (which then dictates pricing strategy and promotional strategy and customer acquisition strategy and merchandising strategy). We're going to have to choose Baby Boomers or Millenials (Gen-X doesn't count ... I should know ... I'm in Gen-X). We're going to have to be inclusive or exclusive. We're going to be factual with or lie to our customers (please choose the former).

2017 is going to be such a fun year! We're going to rebuild our businesses, setting ourselves up for success in 2018.

Kevin Hillstrom

Kevin Hillstrom, President, MineThatData

Kevin is President of MineThatData, a consultancy that helps CEOs understand the complex relationship between Customers, Advertising, Products, Brands, and Channels. Kevin supports a diverse set of clients, including internet startups, thirty million dollar catalog merchants, international brands, and billion dollar multichannel retailers. Kevin is frequently quoted in the mainstream media, including the New York Times, Boston Globe, and Forbes Magazine.

Prior to founding MineThatData, Kevin held various roles at leading multichannel brands, including Vice President of Database Marketing at Nordstrom, Director of Circulation at Eddie Bauer, and Manager of Analytical Services at Lands' End.

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